Business this week

A family affair

A whiff of nepotism and the outrage of shareholders accompanied the appointment of James Murdoch as the new chief executive of BskyB. His father, Rupert, is chairman; Murdoch senior's News Corp owns just 35.4% of the satellite-TV firm. To assuage investors, two new independent board members were proffered and a dividend was promised. Despite James's success at Asia's StarTV, many suspect that dad will continue to pull the strings anyway.

Gucci lost some sparkle. Domenico De Sole, its chief executive, and Tom Ford, its chief designer, will quit the French luxury-goods business next year. The pair, who revived Gucci's fading appeal, failed to agree new contracts with Pinault-Printemps-Redoute, Gucci's majority shareholder.

Wal-Mart, the world's largest retailer, was told that it faced a grand-jury investigation into accusations that it had broken immigration laws. Some 250 cleaners hired by a contractor were arrested in raids on 60 stores in October for working in America illegally.

Corporate crime

Richard Scrushy, a former chief executive of HealthSouth, was charged with 85 offences, including money-laundering, conspiracy and fraud, connected with a $2.7 billion accounting scandal uncovered earlier this year at the American health-care firm.

A judge approved plans for MCI to emerge from Chapter 11 bankruptcy. The American phone company, formerly known as WorldCom, sought protection 15 months ago after admitting it fabricated $11 billion in profits. Competitors argue that MCI will gain significant advantage after $35 billion of debts are wiped out.

Microsoft launched a campaign to protect its software from viruses and improve internet security. Rather than a complicated technological fix, the software giant put a bounty of $250,000 on the heads of the writers of two recent viruses.

Tyco said that it would shed 7,200 employees as part of a restructuring package aimed at slimming a conglomerate made unwieldy by the disparate acquisitions of Dennis Kozlowski, a former chairman. The Bermuda-based company also announced a quarterly loss of $297m. Mr Kozlowski is currently on trial, accused of looting Tyco of hundreds of millions of dollars.

Americans irritated by unsolicited telemarketing calls will be gratified to hear that a $780,000 fine was imposed on AT&T for bothering householders on its own “do not call” register. The phone company is the first to fall foul of a ban on calling Americans who just want to be left in peace. Some 54m people have signed on to a national “do not call” register; 51,000 have complained so far.

Back on trial

Frank Quattrone, a former star technology banker at CSFB, is to face a retrial on charges that he obstructed justice in an investigation into the allocation of hot tech stocks. A previous trial was abandoned after the jury could not agree on a verdict.

The Securities and Exchange Commission reacted to charges that it was slow to investigate improper trading practices by mutual funds. A senior official resigned and charges were brought against seven former employees of Prudential Securities. Meanwhile, Lawrence Lasser, the head of Putnam Investments, resigned a week after two former managers were charged with securities fraud.

John Reed, interim boss of the New York Stock Exchange, unveiled plans to revamp governance. He nominated eight worthies to a new independent board, including Madeleine Albright, a former secretary of state. Almost all of the current 27-strong board of Wall Street insiders will go. Controversially, Mr Reed made no moves to separate the exchange's regulation from its other functions.

BNP Paribas surprised with the announcement that profits in the third quarter had jumped by 69% compared with a year ago, to euro970m ($855m). The bank, one of the euro area's biggest, made handy returns on its investment as stockmarkets rallied.

Credit Suisse reported a profit of SFr2 billion ($1.5 billion) in the third quarter after a heavy loss a year ago. Private and retail banking did well; CSFB, the investment-banking arm of Switzerland's second-largest bank, was less successful.

Rates of change

The Reserve Bank of Australia beat the Bank of England and raised interest rates by a quarter of a percentage point to 5%. Later, the Bank of England also added a quarter point to take its rate to 3.75%. Observers believe that economic recovery and a rapid expansion of credit will force other central banks to follow suit.